GLD or DGZ in a Traditional IRA? There's a structural difference between CEF and GLD which makes their tax treatments very different.
As you noted, CEF should qualify as a qualified electing fund (QEF). Basically, it gets treated as a closed end fund that just happens to own precious metals. So it gets the usual cap gains treatment.
On the other hand, GLD is structured as a grantor trust, meaning that the shares represent proportional ownership of the actual gold (and not shares of a company that happens to have gold as its only asset). Since
you own the gold, any gains you recognize will be subject to collectibles tax, not cap gains tax. That's generally 28%, and a good reason not to own it in a taxable account.
http://www.etf.com/sections/features/21952-structure-matters-how-gold-fund-gld-works.html?fullart=1&start=3The last question on that page deals with the taxation of GLD. It also addresses the original question in this thread:
Until 1997 gold was treated as a collectible. You cannot own collectibles in an IRA. Thus you could not own something like GLD in an IRA. Since 1997, gold bullion products are treated as investments, not collectibles, for IRA purposes. So you're allowed to own them in an IRA. (But you still can't own gold jewelry in an IRA.)
Driehaus Frontier Emerging Markets Fund in registration When a fund has a high "initial minmum" is an investor required to maintain that minmum forever? I have often wonder if an investor could meet the initial minimum and than after the "minimum holding period" lower their balance to a more appropriate amount.
The answer is generally *NO* I say generally because I have never had a fund company require me to maintain the high initial minimum, say 2
50M or so.
Driehaus Frontier Emerging Markets Fund in registration It is curious. The other Driehaus funds are $10k - 25k, and they don't typically allow supermarkets to waive those.
As the time gets closer, I'll ask. For the nonce they're not going to speak, citing the SEC's "quiet period."
David
